RE:RE:RE:RE:RE:RE:TD Upgrade to $6.50 tender.Marcelon, not sure where you got the 3.27% number, but here is the article I was referring too............... Pacific Rubiales Energy Corp. (PRE-T) C$5.73 Downside Still Concerns Us; But We're Hopeful Deal Will Complete Event Pacific Rubiales Energy (PRE-T) this morning announced that the requisite holders of its senior notes have consented to proposed indenture amendments. Further, a special meeting of shareholders has been called for July 7 to vote on the previously announced deal to be acquired by a newly formed company jointly owned by ALFA SAB (ALFA-MM) and Harbour Energy (private) for C$6.50/share in cash by way of a plan of arrangement. The company now expects to mail the information circular for the meeting shortly. Impact: SLIGHTLY POSITIVE. The events above have improved our assessment of deal risk and they represent timely progress toward potential deal completion, which the company continues to expect in Q3/15. That said, potential obstacles remain. We continue to view C$6.50/share as a very compelling valuation for shareholders, and can see an attraction to holding and tendering shares to potentially receive cash in that amount. Most importantly (as it relates to our rating of the stock), Pacific Rubiales' share price has shown weakness in recent weeks that has not been completely reversed in early trading today, and has increased the annualized effective return potential if the deal does close in a timely manner. We continue to see risks to closing, including stated opposition by a major shareholder group. However, in our view, valuation now recognizes more of the substantial downside potential that we see to share prices in the event that the deal should not close. We therefore no longer see a REDUCE rating as appropriate, and are upgrading our rating to TENDER.TD Investment Conclusion Pacific Rubiales has a significant track record of operational execution and acquisitions since 2006, delivering growth in production and reserves. It also has a large portfolio of development and exploration projects. As the largest public Latin America-focused independent E&P, we have long viewed Pacific Rubiales as a potential take-out target for large companies (or private equity) wanting to increase their Latin American E&P exposure. We are encouraged by the potential that Mexico’s ongoing energy reforms could hold for International and North American E&Ps, and view Pacific Rubiales as reasonably well positioned to gain assets there.If the deal does not close for any reason, we are concerned that Pacific Rubiales will need permits, infrastructure expansion, exploration success, and local community/partner co-operation to achieve production targets. Assuming Brent averages $57/bbl in 2015 and a take-out does not occur, we currently expect the company to generate under $700 million of 2015 cash flow and with net debt of $5.2 billion (C$6.5 billion), we would view financing risk as very high. Pacific Rubiales is also currently trading at a significant premium to its closest comparables on Fully-risked NAVPS. That said, absent closing of the proposed arrangement, potential positive catalysts could include results from regular drilling across a large portfolio of exploration assets and development projects; first bidding results from Mexico’s first licensing round in July; and start-up of the delayed Agrocascada surface water disposal project and the Puerto Bahia port (both expected in 2015).Details & Outlook Our estimates are unchanged. The company expects a Q3/15 transaction close, subject to conditions including: All required regulatory/government approvals At least 66⅔% shareholder approval and a simple majority of minority excluding ALFA’s shares (voting July 7) Dissent rights exercised representing not more than 5% of common shares (or a waiving of this condition to the offer). O'Hara and joint actors owning ~19.8% of the company are opposed to the offer, but assuming 80% voting participation they do not have sufficient interest to block the votes. They do have sufficient interest to trigger the dissent condition; however, this would require these parties making the necessary public disclosures. Research Dissemination Policy TD Securities makes its research products available in electronic and/or printed formats and simultaneously distributes them to its institutional clients who are entitled to receive them. The Action Notes are distributed by email, and are available in PDFform on Thomson Reuters, Bloomberg, S&P Capital IQ and FactSet. Research Reports are distributed by email; they are also printed and distributed by courier to our entitled clients. PDFs of Reports are available on Thomson Reuters, Bloomberg, S&P Capital IQ and FactSet. All research is available by password to entitled institutional clients at https://www.tdsresearch.com/equities Read more at https://www.stockhouse.com/companies/bullboard/t.pre/pacific-rubiales-energy-corp#vyktyGZW3roYaJs2.99